California Real Estate Headline Roundup

Posts Tagged ‘homebuyer tax credit’

Today’s News Synopsis:

According to Interthinx, investor-committed occupancy fraud increased 25% in the first quarter. 50% of 1,000 mortgage borrowers surveyed by the National Foundation for Credit Counseling said they could not afford a 20% down payment. CoreLogic claims national home prices rose 0.7% in March. HOPE NOW said foreclosure starts fell 25% in April.

“The 0.4 percent gain followed a revised 0.1 percent increase in March that was smaller than previously estimated, Commerce Department figures showed today in Washington. The median estimate of economists in a Bloomberg survey projected a 0.3 percent increase.”

“Banks trying to foreclose on homeowners are hitting another roadblock, as some delinquent borrowers are successfully arguing that their mortgage companies can’t prove they own the loans and therefore don’t have the right to foreclose.”

“Treasuries surged, pushing 10-year note yields below 3 percent for the first time in 2011, as U.S. companies added fewer jobs in May than economists forecast and manufacturing expanded at the slowest pace in more than a year.”

“The CMBS delinquency rate fell five basis points from April to 9.6%, according to Trepp analytics firm which released the numbers Wednesday. About .64% are 30-days delinquent, .50% are 60-days delinquent, 2.7% are 90-days delinquent and 1.84% are real estate-owned. Many of the delinquent loans (2.98%) are in foreclosure.”

“Half of the more than 1,000 borrowers surveyed by the National Foundation for Credit Counseling said they would never be able to afford the 20% down payment required under the qualified residential mortgage structure. Federal regulators proposed a rule in March requiring lenders to maintain 5% of the risk on mortgages pooled into securities, except for those loans that meet a variety of standards including a 20% down payment.”

“The Chicago-based executive outplacement company said employers have disclosed plans to shed about 204,400 jobs so far this year, which is 21% lower than the first five months of 2010. Last month’s planned cuts of 37,135 was up 1.8% from April and down 4.3% from 38,810 for May 2010.”

“The company says its index shows that home prices in the U.S. rose 0.7 percent between March and April, the first such increase since the homebuyer tax credit expired in mid-2010. However, national home prices are down 7.5 percent compared to April 2010, after an annual drop of 6.8 percent reported for March 2011.”

“Foreclosure starts nationwide were approximately 163,000 in April, down 25 percent from 217,000 the prior month, reports the industry alliance HOPE NOW. An earlier assessment by the nonprofit group showed that new foreclosures had increased 21 percent over the February-to-March period.”

Looking Back:

One year ago, the head of CoreLogic believed the real estate market had bottomed. According to the Commerce Department, construction spending increased 2.7 percent in May. LPS reported the number of loans 90 or more days past due — including pre-sale foreclosure — declined by nearly 3% to just over 4.07m from nearly 4.19m in March. According to Altera Real Estate, housing demand had dropped by 17%.

Today’s News Synopsis:

Approximately $326 million in credit went to over 47,000 taxpayers who didn’t qualify as first-time homebuyers, according to the Treasury Inspector General. When a borrower in default seeks a loan modification, the bank often pursues foreclosure. Ginnie Mae is ending the flat fee for servicing reverse mortgages.

In The News:

“The numbers report for the home-building industry couldn’t have been more grim in February: New-home construction in the U.S. fell to a pace that would translate to about 250,000 homes for all of 2011, which would be the fewest built since the Commerce Department began keeping track in 1963.”

“about $326 million — went to more than 47,000 taxpayers who didn’t qualify as first-time homebuyers because there was evidence they had already owned homes, said the report by J. Russell George, the Treasury inspector general for tax administration.”

“Builder confidence in the market for newly built, single-family homes slipped back one notch to 16 on the National Association of Home Builders/Wells Fargo Housing Market Index (HMI) for April, released today. The index has now held at 16 for five of the last six months.”

“The top income tax rate is 35 percent, so how can people who make so much pay so little in taxes? The nation’s tax laws are packed with breaks for people at every income level. There are breaks for having children, paying a mortgage, going to college, and even for paying other taxes. Plus, the top rate on capital gains is only 15 percent.”

“should big banks be regulated as utilities? At a conference this week, Kansas City Federal Reserve Bank President Thomas Hoenig asserted that big banks already are public utilities, since they’re implicitly government-backed. As a result, he suggests regulating them like utilities. Is he right?”

“The magnitude of FICO® Score impact is highly dependent on the starting score. There’s no significant difference in score impact between short sale/deed-in-lieu/settlement and foreclosure. While a score may begin to improve sooner, it could take up to 7-10 years to fully recover, assuming all other obligations are paid as agreed.”

“One of the pressures on the credit is analysts’ estimate that it could cost the U.S. government up to ’3.5% of GDP to appropriately capitalize and relaunch Fannie Mae and Freddie Mac’ in addition to the 1% of GDP already invested. S&P analysts said the government may have to inject as much as $280 billion into the government-sponsored enterprises, which includes $148 billion already spent, to cover losses at the housing finance companies that were put into conservatorship in September 2008.”

“Ginnie Mae will require issuers of reverse mortgage-backed securities to pay servicers based on a basis point strip of the interest beginning this summer. The requirement, which takes effect July 1, essentially ends paying a flat fee for the servicing of these loans.”